The Director-General of the Social Security and National Insurance Trust (SSNIT), Dr. John Ofori-Tenkorang, has revealed that the government, through the Controller and Accountant General’s Department (CAGD), has cleared an outstanding principal debt of GH¢1.1 billion owed to SSNIT.
The debt represents contributions owed by the Government of Ghana towards their First Tier social security of state employees, as of December 31, 2020.
During a session with the Public Accounts Committee (PAC) of Parliament on July 21, 2023, Dr. Ofori-Tenkorang informed the committee that the amount of GH¢1,124,568,970.17 (principal only) was successfully paid by CAGD for the outstanding debt as of December 2020.
However, the penalty amounting to GH¢3,209,818,256.22, also accrued as of December 2020, remains unpaid.
The National Pensions Act, 2008 (Act 766) empowers SSNIT to impose a 3 percent penalty on delayed payments by CAGD, which has accumulated over the years.
Management is currently in discussions with CAGD and the Ministry of Finance (MoF) to address the penalty issue and work towards reconciliation and settlement.
Most of the matters raised in the 2021 Auditor-General’s report are follow-ups on legacy issues spanning two decades, previously identified in the previous year’s report.
The SSNIT management has actively resolved a majority of these issues and implemented measures and policies to prevent similar occurrences in the future.
The settlement of the GH¢1.1 billion debt represents a significant step in resolving financial obligations to SSNIT and upholding contributions for the welfare of government employees.
As discussions continue between SSNIT, CAGD, and the Ministry of Finance regarding the penalty payment, efforts are being made to ensure full compliance with the National Pensions Act and foster transparency in the pension system.
About SSNIT
The Social Security and National Insurance Trust (SSNIT or the Trust) is a statutory public institution charged under the National Pensions Act, 2008 (Act 766 as amended by Act 883) with the administration of Ghana’s Basic National Social Security Scheme.
Currently, the Trust is the largest non-bank financial institution in Ghana. Its mandate is to cater for the First-Tier of the Three-Tier Pension Scheme.
The SSNIT Scheme replaces part of the lost income of Members due to Old Age, Invalidity or upon the death of a Member, where nominated dependant(s) receive a lump sum payment. It also pays Emigration benefits to non-Ghanaian Members who are leaving Ghana permanently.
The SSNIT Pension Scheme has an active membership of over 1.9 million. In July 2023, the Trust paid a total of GH¢369.40 million to some 239,415 pensioners. The highest pension earner receives GH¢169,725.89 per month, while the lowest-earning new pensioner gets GH¢300.00.